Hunton Retail Law Resource

At the end of May, President Trump unveiled his latest proposed budget blueprint for 2018. The proposed budget contains significant funding cuts for many government programs, including more than a 25 percent cut to the Supplemental Nutrition Assistance Program (“SNAP”), formerly known as the Food Stamp Program.

On June 7, 2017, the Department of Labor (“DOL”) announced that it is withdrawing two administrative interpretations issued by the DOL under the Obama administration in 2015 and 2016 relating to misclassification of independent contractors and joint employment. These two administrative interpretations sought to expand the definition of "employee," thereby increasing the possibility of misclassification cases, and, as some argued, expanding the concept of joint employer under the Fair Labor Standards Act. While this is a welcomed announcement for employers, the DOL ...

May’s 30 recalls—more than any month thus far in 2017—cover furniture, toys, appliances, lithium batteries, recreational vehicles, kitchen gadgets and more. Conspicuously absent so far from the list are fidget spinners, the now viral children’s toy making headlines recently for choking-related dangers. Retailers catching up to the hot demand should keep an eye on those warnings to see if they convert into recall activity in case the gadget is deemed worthy of a market exit that rivals the pace of its entry. In light of the CPSC’s willingness to impose penalties on retailers who sell recalled items, retailers should take stock of their recall plans of action.

This past week, several consumer actions made headlines that affect the retail industry.

FTC Jumps to Consumers' Defense in Trampoline Marketing Deception

On May 31, 2017, brothers Son Le and Bao Le agreed to settle FTC charges that their trampoline marketing deceived consumers by directing them to review websites that were not, but claimed to be, independent, and by failing to disclose financial interests when posting online product endorsements. The Le brothers created fictitious trampoline experts, including "Trampoline Safety of America" and the "Bureau of Trampoline Review," and built fake websites with fake expert reviews to induce customers to buy their trampolines. The administrative consent order prevents the Le brothers from engaging in such deceptive behavior and requires clear and conspicuous disclosure of any material connections between the reviewer and the product. 

On May 26, 2017, Alcoa Community Federal Credit Union (“Alcoa”), on behalf of itself, credit unions, banks and other financial institutions, filed a nationwide class action against Chipotle Mexican Grill, Inc. (“Chipotle”). The case arises from a breach of customer payment card data. The putative class consists of all such financial institutions that issued payment cards, or were involved with card-issuing services, for customers who made purchases at Chipotle from March 1, 2017, to the present. Plaintiffs allege a number of “inadequate data security measures,” including Chipotle’s decision not to implement EMV technology. 

On June 1, 2017, the new Cybersecurity Law went into effect in China. This post takes stock of (1) which measures have been passed so far, (2) which ones go into effect on June 1 and (3) which ones are in progress but have yet to be promulgated.

If you are a retailer, you may have policies and procedures in place regarding who can speak on behalf of your company. Such policies may generally instruct employees not to speak to the press as a representative of the company, and to direct all media inquiries to a particular person or department. Similarly, if you are a retailer, you may have a policy in place that instructs employees to forward any reference requests to your human resources department. These commonplace policies allow retailers to control their public image and protect employee privacy, among other benefits. But, according to a recent decision by a National Labor Relations Board (“NLRB”) administrative law judge (“ALJ”), such policies may violate the National Labor Relations Act (“NLRA”) by interfering with, restraining or coercing employees in their right to engage in concerted activity.

Earlier this month, Jay Clayton was sworn in as Chairman of the Securities and Exchange Commission (“SEC”). He has begun assembling his front office staff, and wasted no time in appointing William Hinman as director of the Division of Corporation Finance and Robert Stebbins as general counsel. Each of the three were previously partners at prominent corporate law firms, and each has substantial experience in corporate governance, capital markets transactions and mergers and acquisitions.

Private equity investors face unique challenges when procuring or renewing their liability insurance programs. For example, investors typically must complete lengthy applications or sign warranty and representation letters from their prospective insurers that inquire into knowledge by any potential insured as to any acts or omissions that could potentially give rise to a claim. These overly broad, and often vague, inquiries are problematic for private equity investors who would theoretically have to interview every employee, manager or director at every subsidiary, fund ...

On May 23, 2017, various Attorneys General of 47 states and the District of Columbia announced that they had reached an $18.5 million settlement with Target regarding the states’ investigation of the company’s 2013 data breach. This represents the largest multi-state data breach settlement achieved to date.